The DoubleThink » Analytics

Heatmaps for Free

Dimitri — Thu, 18 Nov 2010 16:00:31 +0000

I remember the first time I showed a heatmap of a website to a client in a new business pitch a couple of years ago. They thought it was the coolest thing they had ever seen and I believe we won the pitch just because of it. Nobody was doing it at the time. We had partnered with one of the pioneers in the area and it was a big undertaking. But it paid off. Soon after we started using them for all of our clients. The results were great and for a short amount of time it was a real differentiator for our team. We even rented an eye tracking machine so we would have it on site in our office (it sounds more spectacular than it is. It’s really just a PC monitor with a couple of sophisticated webcams).

But soon everyone started doing them and while they still have value, heat maps no longer are a differentiator. I recently found out they have entered the final stage of commoditization – they’re given away for free. On Tim Ash’s website http://www.attentionwizard.com you can create your own heatmaps in a matter of minutes – for free. I gave it a go for the doublethink. You can see the result above. If this was an ecommerce site I would probably make a few changes … .

While the tool is pretty cool, I think the most interesting part of this whole story is how a cutting edge, highly sophisticated optimization technology got automated and completely commoditized in only a matter of years. Change really is accelerating!

Music is Math

Dimitri — Sat, 11 Sep 2010 12:34:01 +0000

I have been pretty obsessed with a little side project over the last couple of weeks which explains why activity on the left column on this blog has been low … . It all started about a month ago when a colleague in London told me about the Korg drum computer app on the iPad which transforms the iPad into a wicked beat machine. I was immediately hooked. After a couple of days of beat making I decided I was ready for something bigger and I started looking into other music software. That’s when a very kind Best Buy employee introduced me to Reason. My life will never be the same again!

I have no musical background, have never played an instrument and never went to music school. I was a complete novice when I picked up Reason 3 weeks ago. A couple of Youtube reason tutorials later, I launched my own little one man band on myspace.

The software is incredible. It allows you to make any sound imaginable, from horns to electric guitars, from techno synthesizers to monk chants and crickets. These instruments play notes on different tracks which you can then combine in a mixer. The picture below shows a Reason screenshot with a song that is played on 12 different tracks.

It also has a number of drum computers you can use to make your own beats or you can select from a library of hundreds of pre made loops. The possibilities seem endless and while you can make things extremely complicated (Reason is used by pro’s like the Prodigy), I found myself finishing my first song in just 2 days.

What quickly became clear in this process is how similar making music is to analytics. While I was composing and arranging, it felt like I was using the part of my brain I use while writing code in SAS. That shouldn’t be surprising. The theory about the similarities between music and mathematics goes back all the way to Plato. There is even a wikipedia entry devoted to the subject. The screenshot above shows has the structure of a database. Every track is a file of data (notes) that is linked through the rhythm and the beat.

Analytical skills came in really handy in interpreting the notes, especially when you have never had musical training. I quickly discovered how useful midi files are. Midi files are similar to mp3 files but rather than containing the sound waves, they contain the musical instructions for the instruments (the notes, the rhythm, the velocity and length of the notes, …). You can read them automatically into Reason and they show up like different tracks on a screen like the one shown above. You can then select which instruments you would like to play which tracks and then move blocks of notes around to compose and arrange different variations of the song. A lot of midi files can be downloaded from the web.

Not every song is available on midi though. When I wanted to make a dance version of one of my favorite 90’s grunge songs I couldn’t find the midi for the song anywhere. I was stuck. So I started looking for a solution and came across Widisoft, a software package that reads in sound files and translates them to midi files. Here is a screenshot of my grunge song translated by widisoft. It is remarkable how similar it looks to the punchcards that came out of the first computers. It’s data in it’s purest form!

At first sight the screenshot looks like random dots on a couple of bars. But when you listen to the song and look at the data at the same time you quickly start to see the patterns that identify which data points correspond to which sequences and instruments. Some intuitive pattern recognition allows you to split this data stream into different organized tracks pretty easily. This creation of order out of data chaos is very similar to what data analysts do when they analyze large data sets.

I decomposed the data, mapped the different tracks to new instruments, put it all on a house beat, rearranged the sequences and recorded Slaphappy. Fans of early 90’s Seattle grunge might recognize some of the riffs.

Learning to Read the River

Dimitri — Fri, 06 Aug 2010 15:15:29 +0000

Last week Ogilvy launched their new thought leadership program called the Red Paper series. I was fortunate enough to be able to write the very first one – Learning to read the river. The paper describes how all the data that is generated today provides a huge opportunity for companies to grow their business. It describes 4 building blocks companies need to put in place in order to extract business value from the data : Ergonomic Measurement, 3 Step Insight, The Single Enterprise View and the Math Marketing Organization.

You can find the paper here. Hope you like it!

Read the river_ogilvy_red_paper

View more documents from Ogilvy & Mather Worldwide.

thedoublethinkTV – Interview Dominique Hanssens

Dimitri — Fri, 18 Jun 2010 12:34:20 +0000

The latest video on thedoublethinkTV is an interview with Dominique Hanssens, Dominique Hanssens is the Bud Knapp Professor of Marketing at the UCLA Anderson Graduate School of Management, where he has been on the faculty since 1977. He has served as the school’s faculty chair, associate dean, and marketing area chair. From July 2005 to June 2007 he served as Executive Director of the Marketing Science Institute in Cambridge, Massachusetts. He is also one of the founding partners of Marketshare Partners.

In the interview he discusses a wide range of topics in the area of marketing effectiveness and accountability.

You can watch our other videos on thedoublethinkTV.

Next Generation Geo Marketing

Dimitri — Wed, 09 Jun 2010 12:00:06 +0000

A friend just sent me this beautiful visualization of where people are taking pictures in London. You can clearly see the high traffic areas around the tourist hotspots. It’s a great use of the type of data people are generating by going about their everyday lives. It also shows how this data could become really practical for marketers trying to find out who is where at what moment in time. I am sure the picture would change if we were to look at certain times of day, days of week, seasons or even profiles of the people that are taking pictures. The view would be very different for people who live in London vs those who don’t for example.

This type of location based behavioral data could give marketers very valuable information about when they need to be where in order to surround their target audience. It seems this data would be able to provide much more detailed information than what is currently available. While this particular application only looks at where people are taking photographs, other location based services like Foursquare generate tons of data about what people are doing where. Foursquare already automatically shows their users which locations are trending (ie becoming popular) real time.

The application of location based behavioral data will go well beyond location based targeting on mobile devices. I believe it will soon become the basis for the next generation of geo marketing tools. Retailers for example could use it to determine where to locate their stores and media planners could use it for planning their outdoor advertising. We could even use this new type of data to profile zip codes based on the activities of the people who live there. These zip code profiles could be used in the same way marketers are now using socio demographic profiles of zip codes for targeting. The current profiles are pretty static since they are based on more traditional sources like the Census. The behavioral location based profiles could be much more dynamic and a lot more detailed. A company like Foursquare, if it wanted to, could actually already very easily make these zip profiles available to marketing professionals. This would make them a real competitor to established 3^rd party data vendors like Acxiom and Experian.

The Value of Stories

Dimitri — Fri, 07 May 2010 21:01:18 +0000

What is the actual value of a story? Are people prepared to pay more for something if there is a story attached to it? It turns out that they are. That is the outcome of a very original experiment by writer / NYT columnist Rob Walker. I saw Rob speak about his Significant Objects project, a project which I think might have generated a very significant dataset.

Here is what Rob did. He purchased a bunch of random objects on Ebay, most of them for less than $4. He then distributed the objects to his friends, fellow writers and artists and asked them to write a short story about the object they were given. He then put the objects back up for sale on ebay with the story in the description to see if people would pay more for the object now there is a story attached to it.

It turned out they did. When he sold the first 100 objects, he essentially sold $120 worth of objects for $3,612 – a 2,776% significance markup as he calls it. The object in the pictire above was the highest seller of the 1st wave of products he sold – $193 for a statue he initially bought for $3. He even sold a 25c plastic banana for $75.

So people were prepared to pay a lot more than the initial value of the storyless object. In fact the difference was so big that Rob concluded that the real value was in the story – the object was merely the vehicle for the story.

That’s very interesting and it obviously gives us a view in how brands work. But what I find most interesting about the experiment is the dataset it created that showed the exact monetary value of stories. I would love to analyze that data to see what really drove the value of the story. Was it the object, the synergy between the story and the object, the reputation of the writer or are there any attributes in the story itself that give us clues about what creates its value.

The data is available on the website. I might play around with it if I find the time. Here is the video of Rob Walker’s presentation at PSFK.

Your voice reveals your subconscious

Dimitri — Tue, 06 Apr 2010 16:27:25 +0000

I met a slightly creepy yet really interesting company yesterday. Voiceprism has a technology that analyzes sound waves generated by the human voice. This gives them the ability to listen to an individual for 10 minutes, establish a baseline voice pattern and then detect the deviations from the normal frequencies. These deviations have proven to be indicative of emotions such as excitement, stress, delight, anger, …

This reminded me of the biometrics Innerscope looks at to gauge emotional engagement. The voice could be an additional data point that can give us clues about what is happening in the subconscious. The main differentiator for this technology is its ability to listen in on thousands of phone conversations. This means it can be used at scale in a cost effective way. I haven’t seen another technology that has the potential to capture data from the subconscious for potentially thousands of consumers.

They talked to me about their work with insurance companies where they analyze claims calls and flag insurance claims that should be investigated further based on the stress levels of the callers. They were basically doing automated lie detection. This apparently helped insurance companies dramatically reduce fraud levels.

I think there could be other interesting applications, especially in quantitative research where it is often hard to quantify true emotional engagement through analyzing what people are saying. How they are saying it can now apparently give us valuable clues as well. Click here to see a video of how the technology works.

TV’s emotional impact

Dimitri — Fri, 12 Mar 2010 20:34:26 +0000

In my previous post I listed some empirical evidence that shows that TV advertising is becoming increasingly effective. One of the reasons is that TV is a superior medium for driving emotional engagement. The role of emotional engagement in driving purchasing behavior has been hotly debated in the last couple of years. This is as a result of advances in neuroscience that have demonstrated that the decisions people make are often a result of what happens in their sub-consciousness. As a result the traditional linear AIDA model, where the role of communications and advertising is to move customers down a linear path from awareness to interest to desire to action by grabbing their attention, has been severely challenged.

Robert Heath has published extensively on this topic and has shown that the role of emotions in the decision making process are very important. In a 2009 Admap article about how TV builds brands he said :”Early advertising models that addressed the role of emotion in advertising reflected the thinking of the time, which was that ‘conscious thinking’ leads to ‘feeling’, which leads to ‘attitude change’, which, in due course, leads to a purchase decision. They were not to know at the time, but they got it seriously wrong. Feelings and emotions are processed much more quickly than thoughts.” Heath has used brain scanning technology to show that we usually make decisions up to 1/5th of a second before we are aware of them. He says that “we always form an attitude about a decision through emotional and subconscious rational processing before we start to consciously and actively ‘think’ about it. So our conscious thinking tends either to support the decision or counter argue it. There is empirical evidence […] showing that the presence of brands inhibits processing of product attributes and encourages consumers to use shortcut to validate their brand choices.” This is illustrated in the diagram below.

If people use brands as subconscious short cuts, then brands need to be built through communicating at the subconscious level.

This is where TV is especially powerful. Contrary to other media such as print that require conscious processing of information (ie reading), TV more than any other medium can work at the subconscious level by evoking feelings through the uses of visuals and sound. This is why TV is such a powerful medium for creating brands. It does this through emotional communication. And Binet and Field have demonstrated, in the study of the IPA databank I mentioned in my previous post, that emotional campaigns consistently outperform rational campaigns in terms of driving sales, share, price elasticity, loyalty and penetration.

TV still works

Dimitri — Fri, 19 Feb 2010 16:00:06 +0000

In my previous post I talked about how, contrary to popular belief maybe, people are watching more TV than ever and that they are engaging with TV advertising. In this post we will look at whether TV is still an effective medium.

There is an increasing amount of empirical evidence that suggests TV advertising is getting increasingly effective. Perhaps the most often quoted analysis is the one done by Les Binet and Peter Field in 2008. They mined the IPA databank which holds more than 1000 marketing effectiveness case studies from around the world gathered as part of the IPA Marketing Effectiveness Awards. They found that campaigns that used TV have been growing in effectiveness over the past 3 decades. The graph below shows the average % increase in market share growth for campaigns that include TV for the 1980’s, 1990’s and 2000’s.

In June 2009 Joel Rubinson of the ARF performed one of the most extensive reviews of quantitative evidence available in an attempt to validate the hypothesis that TV is losing its effectiveness. He combined 7 different databases of quantitative evidence of the impact of TV campaigns on sales. They included data from the IRI panel, econometric modeling companies like PM Group, Dratfield and Marketing Evolution and research data from Pointlogic and Milward Brown. This combined database contained more than 300 cases across 74 different product categories. Rubinson was not able to validate the hypothesis that TV is becoming less effective. On the contrary – 6 out of the 7 databases showed that TV advertising has become more effective over time. The Pointlogic data for example showed that among 25 different types of touchpoints measured in their survey between 2004 and 2007, TV moved up from 7^th to 4^th in terms of people impacted per $1,000 spent. In an interview with Brandweek Rubinson said that his study concluded that “units sold numbers increased as a result of increased TV impressions. [When you observe it] across 388 case histories, I think you’ve got to believe it.

These findings are also confirmed by marketing science company MMA. “We haven’t seen a significant trend in the erosion of effectiveness of TV,” said Douglas Brooks, senior VP of MMA in an interview with Advertising Age in Feb 2009. In fact, MMA, which reports to clients each year on its findings regarding aggregate TV effectiveness, has seen a slight uptick in effectiveness in recent years.

Google Analytics Intelligence

Dimitri — Mon, 01 Feb 2010 12:00:17 +0000

This is a bit of a geeky post so apologies in advance. But I have been meaning to write about how fantastic I think Google Analytics Intelligence is. If you are not sure what I am talking about have a look at the video below.

I love it for a number of reasons. First of all it finally embeds very basic analytics best practices in web analytics software. It has bothered me for years that some of the most sophisticated web analytics packages did not even have the most basic significance tests in their standard reports. I have often seen people draw conclusions on the back of results that were statistically insignificant. GA Intelligence will really help avoid this.

Second, it automates some of the mundane analytical tasks. A few rather pessimistic analytics professionals have asked me whether this was the beginning of the end for analytics as a profession – the start of the complete automation of analytics. I don’t see that happen anytime soon! If the basic, repetitive tasks are being automated then that would free up time for analytics professionals to use their skills much more efficiently on more advanced work. There is plenty of that work to be done.

The most important reason why I love GA Intelligence is the seamlessness with which they have incorporated the significance tests in their reports. It is a fantastic example of how to distribute the ability to do more complex statistical analysis among a broader non-technical audience. And the alert system is very elegant as well.

I love it!